Learning the art of swing trading!!!

#1
Hi All,
I went through this thread by Swing King on using the RSI and MA for swing trading, for some reasons i was not able to post on that thread and was thinking it will be good if other members can put in their comments around this.

After going through the amazing thread by Swing King, I figured out that Dr Reddy is one stock which can fit in for this strategy, which is RSI (20 -60) and price below MA( 20/ 50) then short. and if RSI (40-80) and price above MA (20/50) then buy.


However, for Dr Reddy the RSI is weak and the price is in between MA 20 and MA 50, also it has been following the MA 20 (as support) in the past.


Further, if i look at the daily chart, then it gives me a rising window.

Questions:

1. Should we looking at MA 20 or wait the prices to come under MA 50 on the weekly charts for the Sell signal?

2. Also, the daily chart is showing a contradictory scenario by showing a rising window?

Am i missing on some dimension, please suggest?
http://img402.imageshack.us/i/drreddy.png/

 

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#2
Weekly charts will take time to give you a confirmed sell signal, so it might be too late if the trend is not that strong. If the trend is strong then weekly charts will do. What I personally do is look at 60 min charts to confirm sell signals and look at weekly charts to confim the trend.
 
#3
Thanks Sheldon for the reply,

got your point, but how to ensure that there is a strong trend, ADX does not show a strong trend in this case (Around 25) so is there any other indicator which can help me ensure to judge the trend as people have mixed opinion about the usability of ADX.

Also, on 60 mins chart, i think Swing King in his post around this strategy has clearly mentioned that it can generate a lot of false calls due to shorter time frames and whipsaws.

how to cope up with this problem with the shorter time frame and are you using this strategy in your trades ?

Cheers!!!!!
Happy Trading :)
 

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